Generally, these interest rates do not vary widely and move within a narrow range. However, even a small difference of, say, 50 basis points can significantly increase your investment, especially when the invested amount is substantial and the tenor is long.
For example, an extra 50 basis points on a fixed deposit of ₹10 lakh over a three-year period results in an extra income of ₹15,000. Now, if the invested amount is ₹20 lakh, your extra savings could be as high as ₹30,000.
Let us now compare the fixed deposit interest rates offered by top commercial banks in India.
These 7 banks offer the highest interest rates on FDs
I. HDFC Bank: This bank offers 6.45% on its deposit of three-year tenor to regular citizens and 6.95% to senior citizens. Meanwhile, this bank offers its highest interest when the tenor is between 18 and 21 months.
II. ICICI Bank: This private sector bank offers 6.6% interest on its fixed deposits of three-year tenor to regular citizens and 7.2% to senior citizens.
III. Kotak Mahindra Bank: It offers 6.4% and 6.9% to regular and senior citizens when the tenor is three years. However, the bank offers the highest interest of 6.7% and 7.2% when the tenor is in the range of 391 days to less than two years.
IV. Federal Bank: This private sector bank offers 6.7% interest on its three-year deposits to regular citizens and 7.2% to senior citizens. And these are the highest interest rates the bank offers.
State lenders
V. State Bank of India (SBI): The largest bank in India offers 6.3% interest on its three-year deposits to regular citizens and 6.8% to senior citizens. Meanwhile, the highest rates (6.45% and 6.95%) are given when the tenor is between two and three years.
VI. Canara Bank: This state lender gives 6.25% interest to regular citizens and 6.75 to senior citizens on its three-year deposits. However, the highest rates (6.5% and 7%) are given when the tenor is 444 days.
VII. Union Bank of India: This state lender offers 6.6% interest on its three-year fixed deposits to regular citizens and 7.1% to senior citizens.
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